Michael Avenatti Michael  Avenatti  Charged  With  Trying  To  Extort  Nike,  And,  Separately,  Wire  And  Bank  Scams

Michael Avenatti Michael Avenatti Charged With Trying To Extort Nike, And, Separately, Wire And Bank Scams

Michael Avenatti

Photo: Matt Winkelmeyer (Getty)

This early morning, attorney Michael Avenatti had an announcement.

This was nothing new for Avenatti, a lawyer who rose to recent popularity representing Stormy Daniels in her lawsuit versus the president, and a male who says he discovered a tape of R. Kelly raping a child. He’s been in the news a lot just recently. Nike’s stock even dropped after Avenatti’s tweet.

Minutes later, federal prosecutors in New York and in Los Angeles revealed the arrest of Avenatti in two completely separate cases.

According to the indictment, the Southern District of New York alleges that Avenatti went to Nike last week with a proposal. Avenatti allegedly said he represented a previous AAU coach, one whose program previously a sponsorship agreement with Nike. Avenatti informed Nike his customer had proof of Nike employees paying at least 3 gamers.

Avenatti, according to prosecutors, then told Nike he wanted $1.5 million for his customer; he likewise demanded Nike hire his own firm to conduct an internal investigation of the company, which would pay him more than $9 million. (His demand even consisted of the following caveat: If Nike employed a different law firm to examine the business, Avenatti would still be paid “at least twice the fees of any other company employed,” the indictment states.)

To turn up the heat on Nike, he tweeted this:

The problem states Avenatti prepared to hold the press conference just previously Nike’s profits call last Thursday. Rather he agreed to satisfy with Nike that day and delay his presser up until Monday.

“I’m not fucking around with this, and I’m not continuing to play games… you men know enough to understand you’ve got a serious issue,” Avenatti said at that meeting, according to a video recording made of that meeting. “And it’s worth more in exposure to me to simply blow the cover on this thing. I’m just being truly frank with you.… I’m not fucking around with this thing anymore. So if you people believe that you know, we’re gon na negotiate a million five, and you’re gon na hire us to do an internal examination, but it’s going to be capped at 3 or 5 or 7 million dollars, like let’s just be done … and I’ll go and I’ll go take 10 billion dollars off your customer’s market cap. However I’m not fucking around.”

At just about the same time as the New York statement, Avenatti was charged by the Central District of California with bank and wire fraud for supposedly defrauding one of his clients. From the federal government’s release:

According to an affidavit filed with the criminal complaint in this case, Avenatti worked out a settlement which called for $1.6 million in settlement loan to be paid on January 10, 2018, however then offered the client a phony settlement contract with a incorrect payment date of March 10, 2018. The affidavit states that Avenatti misappropriated his client’s settlement loan and used it to pay expenditures for his coffee organisation, Worldwide Baristas US LLC, which operated Tully’s Coffee shops in California and Washington state, as well as for his own expenditures. When the fake March 2018 deadline passed and the customer asked where the money was, Avenatti continued to conceal that the payment had already been received, court documents stated.

The California case likewise implicates Avenatti of defrauding a Mississippi bank by submitting phony earnings tax returns.

Copies of both problems are below.

Update (3:31 p.m.): The Wall Street Journal says sources have actually identified one other legal representative from the Nike grievance as well as the law firm that did the recording.

Update (3:36 p.m.): Federal prosecutors in New York have shared their circulation chart of what they think occurred, in case you needed a visual.

Update (5:09 p.m.): The press conference held by federal authorities in New York didn’t offer a ton of brand-new details, but the U.S. lawyer for the southern district of New York, Geoffrey Berman, did take concerns from reporters. At the press conference, Berman explained what happened with Aveanatti as “an old-fashioned shake down.”

When asked what made this a case of extortion, as opposed to a settlement negotiation, Berman stated: “Extortion is when you threaten to do something for a thing of worth and you don’t have a ideal, a plausible ideal, to that thing of value. So here, Avenatti was not obtaining in terms of seeking money for a customer. He was seeking loan for himself.”

As for if more charges could be filed, Berman said the examination is ongoing.

Deadspin senior editor Diana Moskovitz contributed to this report.